Although there have been no serious threats to global oil supplies since the Arab uprisings started, oil prices will remain volatile as political developments combine with global economic gloom and surviving regimes spend to pacify populations, a Chatham House briefing paper reports.
The wave of uprisings that began in Tunisia in January 2011 and then spread to all parts of the Arab world was a defining period for the region and the world.
The sweeping pro-democracy rebellions in the region highlighted the kleptocratic nature of many Arab regimes whose behaviour effectively undermined economic progress in countries where private-sector activity struggled to survive. Unemployment and inflation were both sky-rocketing along with international food prices, while standards of living declined. With over 38% of the Arab populations of 280 million in 2000 below the age of 15, the aspirations of an increasing number of young people were being thwarted.
As unrest in the Arab world continues, this paper focuses on the potential implications for the international oil market and specifically for the future price of oil. The region's oil depletion policies, the behaviour of oil markets more generally and relations between members of the Organization of the Petroleum Exporting Countries (OPEC) are all crucial to the prospects for oil prices.